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NEWSROOM for October 25, 2000Aired October 25, 2000 - 4:30 a.m. ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: Seen in classrooms the world over, this is CNN NEWSROOM.
SHELLEY WALCOTT, CO-HOST: And Wednesday is upon us. I'm Shelley Walcott and we're taking care of business today on NEWSROOM. Here's a look ahead.
Topping today's news: Is a breakup in the works for AT&T?
We're still about business in our "Daily Desk" as we strike oil.
Up next in "Worldview," meet business people making the connection between entrepreneurship and economic development.
Then we move on to "Chronicle," where we'll have an encounter of the viral variety.
A major breakup plan may be in the works at AT&T. Analysts say the company is likely to divide into simpler, more focused, separate business units. We'll have more about that in a moment, but first let's look at how the company originated and developed into the United States' largest communications company.
1876, Alexander Graham Bell invents the telephone and makes the first wire transmission of intelligible speech. He gets a patent for the device and, along with two investors, creates the Bell Telephone Company.
1885, Bell starts the American Telephone and Telegraph Company, or AT&T. Its main purpose was to build long-distance telephone lines. Over the next several decades, AT&T became the largest company in the world. It was a monopoly, a company that has unfair control of an industry.
In 1974, the United States filed an antitrust suit for the dismemberment of the Bell system. Years later, AT&T and the government reached an agreement and AT&T split up and left the local network business by reorganizing into seven regional phone companies. But AT&T remained the United States' largest provider of long-distance telephone service.
AT&T has fought regulators in the past to keep the company from being divided. But now the company appears set to dismember itself for the sake of shareholder value. Steve Young has the story.
STEVE YOUNG, CNN CORRESPONDENT (voice-over): Even with a breakup on the table, concerns about management hangs over AT&T. AT&T is struggling with a stock that's lost more than half its value in the last year. The company wants to help analysts figure out what a combined long-distance, local, cable TV, Internet company really is worth.
ART HOGAN, JEFFERIES & CO.: They're saying that to divest and actually separate its core businesses into separate units would be -- they'd be better able to enhance shareholder value. It would actually get shareholder value out of some of the different units they have.
YOUNG: AT&T is expected to announce either a three- or four-way breakup and tracking stocks.
Some wonder if that will do the trick since AT&T has already launched a tracking stock for its wireless unit, which now trades below its offering price. But other analysts disagree.
MARC CROSSMAN, J.P. MORGAN: Trackers could work. There are plenty of (UNINTELLIGIBLE) like Sprint and Spring PCS where trackers actually did create a tremendous amount of value.
YOUNG: What about Armstrong's decision to invest $100 billion in cable TV systems so he could use them to sell local phone with long- distance service?
RICK FRANKLIN, BANC OF AMERICA CAPITAL MANAGEMENT: A year ago, everybody thought the bundle was going to be a panacea for AT&T and the rest of the industry. And there are some doubters out there whether or not that's a valid strategy.
YOUNG: Franklin and some other analysts believe bundling still makes sense, at least for the consumer segment of AT&T's business. But consumers have proved fickle. The company spokesman says out of 149 bundles offered by AT&T, one of the most popular combines local and long distance with a coupon good for a free oil change at Jiffy Lube.
(on camera): Investors will decide if a breakup is the grease job AT&T needs right now. Analysts say if one-stop shopping still makes sense, bundling will still be possible but a lot harder to execute.
Steve Young, CNN Financial News, New York.
WALCOTT: In our "Business Desk," we spotlight a substance that keeps the world going. It's oil, a powerful force behind the modern way of life in industrialized nations. Maybe you learned in history class that the first oil well was drilled in Titusville, Pennsylvania -- that's in the U.S. -- by a man named Edwin Drake. That set off a chain reaction of others looking for so-called "black gold." John D. Rockefeller made a fortune from oil. And ironically, Drake died broke.
Oil affects business, politics and the environment.
Garrick Utley digs into the psychology of this precious product.
GARRICK UTLEY, CNN CORRESPONDENT (voice-over): Why are these people happy? Because they struck oil, and, oh, how it pushes our emotional buttons.
There is the romance of oil, the dream of the riches of the black gold. And yet we never actually see it -- oil -- except when Hollywood brings in a gusher.
Think about that. We fought a war over something we never saw, not even when Saddam Hussein set fire to Kuwait's fields. We don't see it when it comes into our homes to give us 70 degrees of comfort.
(on camera): And we don't see it when we pump it into our internally combusting vehicles. And we better not see it when it comes out as exhaust. In fact, the only evidence we can actually see that oil and gasoline exist is this. And we wonder, naturally, who's getting the money.
(voice-over): But it was always thus, starting with John D. Rockefeller, who made America's largest fortune by controlling 90 percent of the oil refining in the United States. Oil as the fuel of envy and anger, for those who control its price can send a black cloud over a sunny economy and our lives, over that basic inalienable right to be free to drive anywhere, anytime, without having to care what it costs.
Oil can create amnesia. Americans may not be aware that the price of gasoline today is a bargain compared to what it cost back when the first Model Ts were mass produced. They got 17 miles to the gallon, not much different from today's Ford Explorers. And the price of a gallon in 1918, in today's dollars, was $2.82.
Human nature, though, cares less for the past than the present. In Europe, we witnessed the furious nature of angry truck drivers and farmers protesting rising prices. Why this new form of road rage?
Perhaps the psychology of oil is driven by our dependency on it. It has become the life blood of modern living. And like the blood within us, which we also never see, we just expect it to be there.
Garrick Utley, CNN, New York.
ANNOUNCER: Teachers, make the most of CNN NEWSROOM with our free daily classroom guide to the program. There you'll find a rundown of each day's show so you choose just the program segments that fit your lesson plan. Plus, there are discussion questions and activities, and the guide highlights key people, places and news terms. Each day, find hot links to other online resources and previews of upcoming desk segments. It's all at this Web address, where you can also sign up to have the guide automatically e-mailed directly to you each day. It's easy, it's free, it's your curriculum connection to the news. After all, the news never stops, and neither does learning.
WALCOTT: In "Worldview," check out Olympic contenders, not athletes but nations vying for the games of 2008. Who's on the fast track? And we continue our look at the United Nations. Yesterday we told you about UNICEF. Ted Turner, an executive of Time Warner, CNN's parent company, just received UNICEF's Trick Or Treat Partner Award. He's a U.N. supporter and donor. We'll find out about young entrepreneurs who could follow in his footsteps.
RUDI BAKHTIAR, CO-HOST: When international aid goes to some governments, are the citizens of those countries always the beneficiaries? One group funded by the United Nations thinks not. And it believes that if aid money is instead put into the hands of small businesses to help them flourish, there's a better chance the population would benefit. That's the theory behind the seventh summit of young entrepreneurs held recently in New York City.
John Dobosz reports.
JOHN DOBOSZ, CNN CORRESPONDENT (voice-over): Young entrepreneurs from more than 100 countries got together in New York to talk business and ponder the possibilities of improving the world one deal at a time.
SUJIT CHOWDHURRY, SEC.-GEN., WORLD SUMMIT OF YOUNG ENTREPRENEURS: I think there is a tremendous change in whole spectrum of entrepreneurship, and accepting entrepreneurship as a way of economic development.
DOBOSZ: Held high up in the World Trade Center and funded by the United Nations and private donations, the Seventh Annual World Summit of Young Entrepreneurs is an exercise in networking and reflects the increasing importance of entrepreneurship around the globe in helping the economies grow.
LUC DECLAPIERS, CEO, CDC NORTH AMERICA: Countries which have socially or social democrat guidance are very suspicious of private enterprise have become pro-business, pro-market economy. And they see that this is a way of growing their own economy and helping others.
BARBARA HASSERIIS, VINTAGE TRAVEL & TOURS, BOTSWANA: We have opportunities that we must take. You know, we should seize that moment because if we don`t take it, nobody`s going to give it to us.
DOBOSZ: Barbara Hasseriis owns a travel company in Botswana. Though the entire African continent is rich in natural resources, it`s long been a laggard in economic development and wealth creation. But Hasseriis believes in the power of individual firms to effect positive change.
HASSERIIS: Gone are the days where you want to be blaming somebody for your problems, because everybody has a story to tell. So, you know, we need to get a grasp of it and start telling our own stories.
JOHN WASSWA, ENVOI, UGANDA: Leaders can be a big impediment to investment. Fortunately for Uganda, our leaders are now sober so we have lots of people investing.
DOBOSZ: Wasswa is a book publisher in Uganda. For the last 15 years, the government of that African nation has been rebuilding Uganda`s infrastructure and trying to escape the brutal economic and social legacy of dictatorship.
WASSWA: Previously, people made a living out of being employed by government. But right now, people are creating their own jobs. I created -- I started my company at the age of 24, shortly after university. And though I`m not as rich as Ted Turner, at least the company`s growing.
DOBOSZ: The summit is a chance for entrepreneurs from developing nations to partner with their peers from the developed world and to put them in touch with possible sources of capital.
The quest for capital is a perennial soar spot for entrepreneurs everywhere, and a big reason many come calling in the U.S. KG Charles-Harris founded a software company in Sweden and moved it to Silicon Valley.
KG CHARLES-HARRIS, EMMANIO, SWEDEN: Depending on your strategy and what type of company you want to be, I think that the United States is really the, you know, is the way that Rome was during Roman times. So you need to go to Rome. Basically, you know, U.S. venture capitalists are used to using money and they`re used to losing money as well, and they are used to making high-risk investments.
ATUL ANAND, INDIA: See, money makes money. That is for sure.
DOBOSZ: Atul Anand comes from India, where entrepreneurship and risk-taking are firmly entrenched. His first business was importing plastic scrap from the U.S., which he did until it was banned. Today, he supplies the U.N. with hardware and services for relief projects around the world.
ANAND: Learning how to be an entrepreneur also needs learning how to fail, but then not die after that. It's to fail, fall down, get up and start running again.
DOBOSZ: For many of the entrepreneurs, success in enterprise has rewards that go beyond the financial ones.
WADE CACHAGEE, PRESIDENT, CREE-TECH, CANADA: I live on a reserve in northern Canada, northern Ontario specifically. I always wanted to go away, get an education, come back home and maybe better my community. I`ve done that now and I see a great future for that. HUMA BEG, SERENDIP PRODUCTIONS, PAKISTAN: In Pakistan right now, with the illiterate population at 60 percent, there needs to -- media needs to play a much bigger role than just entertaining the population. So that`s what we do.
DOBOSZ: Huma Beg studied in the United Kingdom and came back to her native Pakistan to make documentaries that make a difference. Though business is tough, she finds it rewarding.
BEG: Maybe tomorrow we might not become millionaires, but we are on our way of becoming a good business with a vision. And for me, that`s much more important than being a multi-billionairess.
DECLAPIERS: Everybody recognize that jobs are created by small companies. Jobs are created by those young entrepreneurs. They create 20 jobs here and 200 here. That`s how we progress.
DOBOSZ: For "ENTREPRENEURS ONLY," John Dobosz, CNN Financial News, New York.
TOM HAYNES, CO-HOST: When you think of the United Nations, you probably think of the international organization based in New York City. But now think of nations united and what comes to mind? Well, one example might be the Olympics, a sports event that seeks to promote athletic competition and encourage world peace.
We take a look back at the summer games that were held in Sydney, Australia, and a look ahead to future games.
Martin Savidge is our guide.
MARTIN SAVIDGE, CNN CORRESPONDENT (voice-over): How do you top the greatest games ever? That's the Olympic challenge passed into the hands of Athens, Greece, host of the 2004 summer games.
The Olympics head home amidst worries the birthplace of the games is ill-prepared to handle them and has fallen dangerously behind schedule. But the organizer of the Sydney games scoffs at suggestions the Olympics might be back if Athens fails.
MICHAEL KNIGHT, AUSTRALIAN OLYMPICS MINISTER: Sure, Athens is getting some bad press about their preparations, but go back and have a look three or four years ago at what was being said in Sydney.
GIANNA ANGELOPOULOS, PRESIDENT, ATHENS ORGANIZING CMTE.: Time is our enemy, but we know that.
SAVIDGE: The president of the 2004 games admits Greece is like a long-distance runner caught in the back of the pack. But the race, they say, is far from over.
ANGELOPOULOS: What we know is that we have a marathon preparation. It's still pieces of infrastructure that have to be completed. We have the timelines. What we know is that what we've promised up to now we can deliver in Athens.
SAVIDGE: The race is also on to win the gold of the summer games in 2008. All five of the finalist nations -- Turkey, Japan, France, China and Canada -- competed in Sydney for the votes of the Olympic Site Selection Committee. Toronto is considered among the front- runners.
JOHN BITOVE, TORONTO BID COMMITTEE: If this is -- the Olympic games is all about sport and athletes, by far we have the best plan. The fact that we've got 25 venues within 6K of the athletes village is pretty hard to do in this day and age.
SAVIDGE: But Canada has hosted two previous Olympics, unlike China, which after being passed over in favor of Sydney, believes its time has come.
TU MINDGE, BEIJING 2008 BID COMMITTEE: If Beijing hosts the Olympic games, it would be very good, I think, for the combination or emerging or exchanging of different cultures from East and West.
SAVIDGE: China has its own possible drawbacks for Olympic consideration, namely its poor human rights record. Just who will get the games of 2008 won't be decided until July of next year.
(on camera): Both Athens and the host city of the future face the same difficult problem in the aftermath of the 2000 Olympic games: Sydney is one tough act to follow.
Martin Savidge, CNN, Sydney.
WALCOTT: As you've heard, five nations are in a race for the 2008 Olympic games. Those countries again: Turkey, Japan, France, China and Canada. You also heard that China has some drawbacks; for example, it's human rights records.
But as Rebecca MacKinnon explains, China is charging ahead with its bid, putting strong emphasis on its culture.
REBECCA MACKINNON, CNN BEIJING BUREAU CHIEF (voice-over): Fan dancing has always been a favorite pastime for the venerable ladies of Beijing's neighborhoods. But now they have a new mission: "Bidding for the Olympics," they chant, "is everyone's responsibility."
"We all hope China can win this time," says this woman. "Its the hope of the Chinese people."
The cheerleading squad includes Tai Chi clubs, amateur singers. Even local preschoolers are doing their bit. These kids weren't even born when Beijing lost its last Olympic bid in 1993. (on camera): Beijing had hoped to host this year's Olympics, but Sydney was chosen instead. Now Beijing's government and many residents are determined to prove that the Olympics must come to China in 2008.
UNIDENTIFIED FEMALE: Welcome to Beijing.
CLASS: Welcome to Beijing!
MACKINNON (voice-over): In free English classes around the city, Beijing's largely non-English speaking population is already getting prepped for the influx of non-Chinese speaking Olympic fans and athletes they hope will come.
Information campaigns give advice on how to boost Beijing's image: Don't spit or throw garbage on the streets and speak politely to visitors.
WANG DEFANG, ORGANIZER (through translator): If Beijing gets the Olympics, ordinary people will win too because the city's will get an economic boost and our environment will be improved.
MACKINNON: Even China's in crowd is riding the Olympic wave. Singer Gao Feng is taking advantage of China's need for a more tolerant image by launching a nationwide concert tour.
GAO FENG, MUSICIAN (through translator): No Chinese pop singer has had such a big concert tour before. We ought to be able to hold big concerts in our own country.
MACKINNON: Whatever reasons people here may have for cheering on Beijing's Olympic bid, these supporters say they have no plans to stop until the final decision is made next summer.
Rebecca MacKinnon, CNN, Beijing.
WALCOTT: It's something we've all experienced: a sniffle, a cough, and then a full-blown cold or flu. There are lots of medications out there to ease uncomfortable symptoms, but what about those strains of virus that aren't so easy to control?
Our Web site, CNNfyi, recently hosted a virtual discussion with the Centers for Disease Control and Prevention. It was to learn more about the structure and function of viruses, and ways to find, prevent and treat them.
Holly Firfer has more now on the history of infectious disease.
RYAN BOZOF, EVAN'S BROTHER: This is the funeral.
HOLLY FIRFER, CNN MEDICAL CORRESPONDENT (voice-over): April 20 is a day Ryan Bozof will never forget. It's the day his brother, and best friend, died.
BOZOF: He was just a real enthusiastic kid, energetic, a real loving brother. He'd do anything for me and I'd do anything for him. I mean, he was my best friend for all my life and I miss him greatly.
FIRFER: He would do anything, but he couldn't help save his life. His brother, Evan, a college junior, was a healthy athletic 20- year-old, star of his baseball team, studying to be an orthopedic surgeon. The picture of health and strength, Evan woke one morning with a headache. By that evening he was nauseous and vomiting. He rushed to the emergency room. He never left the hospital. Three weeks later he was dead.
LYNN BOZOF, EVAN'S MOTHER: They suspected he had bacterial meningitis.
FIRFER: An infectious disease that's spreading. In fact, according to the CDC, up to 300 students like Evan will contract meningitis this year alone, an increase of 50 percent since 1990.
DR. JAMES TURNER, UNIVERSITY OF VIRGINIA: Living in crowded conditions such as dormitories would appear to increase risk. College students, as you know, tend to be stressed out, stay up late at night, either partying or studying, and that puts them at risk.
FIRFER: Meningitis, like many infectious diseases, was identified first in Africa and Asia and has worked its way around the globe.
DR. JEFFREY KOPLAN, CDC: The boundaries that we live in are no longer the counties that we're in or the neighboring cities, but they're as far away as different continents. That's due to shipping, due to air transport, due to travel by people coming here and our people going elsewhere.
FIRFER (on camera): We have known infectious diseases since recorded history. In 212 B.C. historians first noted an illness that scientists believe was influenza, or the flu; 200 years later, Hippocrates documented the first influenza outbreak in history. Jump to 1300 and to China where the deadly bubonic plague was festering.
(voice-over): At the time, China was a major trading post. Merchant ships from Asia traveled across the seas to Europe, carrying imports, exports and this deadly disease.
Within five years, the bubonic plague, also called the "Black Death," had spread throughout the European continent taking the lives of 25 million people, and soon one-third of all of Europe was gone, a turning point in medical history.
DR. SUE BINDER, CDC: It took months to years to spread across the world. Today an epidemic could potentially spread in days to weeks.
FIRFER: Throughout the centuries, history has continued to record the battles against infectious disease. In fact, your great grandparents might have remembered 1918, when the flu killed more people than World War I. Your parents might even recall the 1968 Hong Kong flu epidemic, which claimed 700,000 lives worldwide.
But we haven't been sitting back and watching nature take over. Armies of doctors and scientists have marched into labs to develop vaccines and antibiotics to fight these deadly diseases.
A great example is one of the most remarkable medical discoveries of our time. It was 1921, polio, a virus that attacks the nervous system and leaves its victims paralyzed, was racing through America, affecting young and old; even one of our presidents, Franklin Delano Roosevelt.
Then a breakthrough. In 1952, Jonas Salk created the polio vaccine. And now, today, in the Western world it's practically non- existent. But scientists warn it's just a plane ride away.
DR. DAVID HEYMAN, WORLD HEALTH ORGANIZATION: The only infectious disease that has really been wiped out has been small pox. Through a global effort between 1967 and 1980, the vaccine that was very effective was used effectively and the disease is now eradicated from the world.
FIRFER (on camera): As quickly as we stop some diseases, new ones develop. In the past 20 years, 30 new infectious agents have been identified.
BINDER: There are a lot of reasons that infectious diseases emerge. Some of them relate to things that we do and ways that we alter the ecology around the world so that we change the habitats in which organisms are living.
FIRFER (voice-over): In 1999, 65-year-old Robert Benson (ph) learned that the hard way. After a month in the hospital with a 105 degree temperature and two weeks on a respirator, doctors couldn't figure out what was wrong with him.
UNIDENTIFIED MALE: We went to Africa, you know, several months ago and they thought it might have be a latent case of malaria.
FIRFER: Turns out Robert was suffering from West Nile virus, an entirely new strain of disease for the Western Hemisphere, working its way across America.
DR. BETH LEVINE, COLUMBIA UNIVERSITY: We don't know exactly what this strain is.
FIRFER: Childhood immunizations have effectively protected children in the U.S., Europe and parts of Asia from diseases like measles, mumps, and whooping cough, among others. But just when scientists began to feel triumphant over these infectious diseases in the industrialized world...
DR. DONALD GAMEN, HOWARD HUGHES MEDICAL INSTITUTE: In 1981-82, a new disease arrived virtually simultaneously in America, in Europe and throughout Africa; a terrifying disease characterized by immune deficiency, opportunistic infection, and even tumors occurring in young men.
FIRFER: Doctors realized that people, no matter who, how healthy or where they lived, were not safe. There was a new disease, one they knew very little about, and one they could not stop from spreading.
(BEGIN VIDEO CLIP, NOVEMBER 7, 1991)
MAGIC JOHNSON: Because of the HIV virus that I have obtained, I will have to retire from the Lakers.
(END VIDEO CLIP)
FIRFER: Today, doctors know more about AIDS, but they still do not know how to stop it. Although messages of healthy living have helped slow the progression of the disease in the U.S. and Europe, AIDS has already left more than 10 million orphans in Africa behind.
GAMEN: We can never get away from infectious disease. We can triumph over individual infections diseases, but the concept that we're going to be free of infection as a species is a ridiculous one.
FIRFER: Most scientists say we are actually as vulnerable as those who lived in the 14th century. They predict the future.
DR. STEVEN MOSTOW, UNIVERSITY OF COLORADO: We're very worried that we'll have what's known as a worldwide pandemic of influenza that will effect, probably, 40 percent of the world's population and could lead to epidemics of mortality that occurred in 1918.
FIRFER: But experts can't predict exactly when this or other disease outbreaks might occur. They sum up the problem this way: The clock is ticking, but we don't know what time it is.
That's why scientists are constantly working on new vaccines, and antibiotics to protect us wherever we are.
WALCOTT: Tomorrow, Holly Firfer will have more. Be prepared to help her solve a microscopic mystery.
In the mean time, it's home again for space shuttle Discovery after a successful landing in the California desert Tuesday. It was too windy in Florida, the normal landing site. The touchdown ended a 13-day mission that included assembly work on the International Space Station. The next planned shuttle mission will be another trip to the space station, this time by shuttle Endeavor in December.
And that wraps up today's show. We'll see you right back here tomorrow.
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